Property tech startup Cadre plans fund to buy in economic slump

[NEW YORK] Real estate technology startup Cadre is planning to launch a new fund to seize on property-market opportunities that arise from the economic downturn in the wake of the coronavirus pandemic, according to people with knowledge of the matter.

The New York-based company has begun discussing the vehicle, which will make commercial real estate bets, with key potential investors including family offices, said the people, who asked not to be identified because the talks are private.

A Cadre representative declined to comment.

Cadre was co-founded by Chief Executive Officer Ryan Williams, Jared Kushner and Josh Kushner. Jared Kushner -- a senior adviser to President Donald Trump, who's also his father-in-law -- sold his Cadre stake in February over concerns of potential future conflicts. His brother, venture capitalist Josh Kushner, maintains a stake in Cadre through his firm Thrive Capital.

Cadre has so far focused on standalone-property deals in which the number of investors is capped by regulatory limits. But the debut fund, which is slated to include accredited retail investors, should enable the company to accelerate its growth by raising and deploying capital at a faster pace, one of the people said.

The startup is initially seeking to raise several hundred million dollars, said the people, and its pitch centres on the company's method of underwriting property deals using proprietary technology paired with human expertise. Cadre draws conclusions in part by analysing 40,000 variables and considering more than 3 million data points, according to its website.

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The company -- which has traditionally focused on multifamily, office and other corners of the real estate world, including life sciences, student housing and self-storage -- had been considering launching the fund before the Covid-19 pandemic hit, one of the people said. It has since decided that it would be prudent to attempt to bolster its war chest so it can move fast if attractive deals surface, the person added.

To date, one of Cadre's fastest ways of amassing capital has been its Managed Portfolio effort, where investors write a check for at least US$50,000 and the company spreads it out over five deals.

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